Why Hasn't the Mortgage Business Rebounded?

Babba

Former Staff
Jul 2007
77,248
68,606
So. Md.
But Duke noted another more surprising cause: the Fed’s campaign to push down interest rates means lenders haven’t had to work very hard to drum up business. Together with federal efforts to ease refinancing rules, low rates have produced a surge of refinancing business. This has delivered a steady stream of high-quality, low-risk borrowers in an industry that already has shrunk significantly. Capacity-constrained lenders have “less incentive to pursue harder-to-complete or less profitable loan applications,” said Duke.

I dunno. I was chatting with a friend the other day who's trying to refinance his house. You'll have to take my word for this, but he's basically about the most reliable, creditworthy, upper middle class person you could hope to meet. Good income, reliable job, longtime bank customer, etc. etc. And yet, his bank keeps finding things to be nervous about. This should be a slam-dunk refi, but it keeps dragging out.
I am involved with a situation very much like this and it's starting to piss me off. It has cost me a lot of money and I'm sick of it. It's bullshit. It must end or our economy will NOT recover. Jus' sayin'.......

http://www.motherjones.com/kevin-drum/2013/04/why-hasnt-mortgage-business-rebounded
 
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Blueneck

Former Staff
Jun 2007
55,704
43,564
Ohio
I got lucky when my patients other caregiver got sick for 4 days and my sister got an income tax refund. We were finally able to catch up on our mortgage after being behind for 8 months. The bank wasn't very helpful during this time, despite the tons of equity we have in the house (we're only $8,000 from it being paid off). It's like they only want to loan you money if you don't need it.

I used to like our bank but they were bought out by a bigger bank, Park National.

I'm just getting to where I hate all banks.
 
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Feb 2011
17,042
6,084
Boise, ID
I got lucky when my patients other caregiver got sick for 4 days and my sister got an income tax refund. We were finally able to catch up on our mortgage after being behind for 8 months. The bank wasn't very helpful during this time, despite the tons of equity we have in the house (we're only $8,000 from it being paid off). It's like they only want to loan you money if you don't need it.

I used to like our bank but they were bought out by a bigger bank, Park National.

I'm just getting to where I hate all banks.
I blew right past hating the banks and decided I just hated the concept of debt altogether.
 
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Mar 2013
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Most people don't know this but just about every big bank that was involved in the robo signing-foreclosure fraud case, are under audit by the Feds. This means EVERY MORTGAGE LOAN they make. I've seen banks asking people who had cedit scores in the 830 range for explaination letters of why they have a re-occurring electricity bill! The scutiny is INTENSE.
 
Jan 2008
32,903
9,709
Vertiform City
Most people don't know this but just about every big bank that was involved in the robo signing-foreclosure fraud case, are under audit by the Feds. This means EVERY MORTGAGE LOAN they make. I've seen banks asking people who had cedit scores in the 830 range for explaination letters of why they have a re-occurring electricity bill! The scutiny is INTENSE.
Please provide corroboration of this claim (a link will do). It doesn't dovetail with what I've been hearing.
 
Aug 2012
10,696
2,782
Please provide corroboration of this claim (a link will do). It doesn't dovetail with what I've been hearing.
Don't know if it is tied to robo-signing but I can verify the experience. I just got word that my refi on a rental property is ready to close yesterday, but it was an ordeal of one thing after another, the last a bit of a hissy fit over whether or not the insurance was escrowed. My guess is it is a combination of more due diligence with the (allegedly) consumer friendly provisions of Dodd Frank.
 
Mar 2012
58,848
40,334
New Hampshire
I am involved with a situation very much like this and it's starting to piss me off. It has cost me a lot of money and I'm sick of it. It's bullshit. It must end or our economy will NOT recover. Jus' sayin'.......

Why Hasn't the Mortgage Business Rebounded? | Mother Jones
Blame Dodd Frank. The new rules and laws actually went to protecting the banks not the consumer as thought. Now decent people with great credit can no longer get simple refi loans let alone mortgages. My daughter is trying to buy her first home and the banks are making a million excuses, my favorite being "you haven't been at your current job a minimum of 5 years." They don't care that she has 25% to put down. It has gotten crazy. I have an acquaintance who works at a credit union and she says they are extremely difficult to get a refi with because they don't want to lend at the lower rates we have now. It really has hurt our economy but as folks are saying above we don't take the time as voters to change the system, we keep voting for the same.




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